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Microsofts GitHub Deal Is Its Latest Shift From Windows

June 5, 2018

There’s more than money on the line in Microsoft’s planned $7.5 billion all-stock acquisition of code-hosting and collaboration site GitHub. If Microsoft screws this one up, it risks losing the considerable goodwill it’s built with developers in recent years.

Sure, any acquisition is risky. But GitHub isn’t just another programming tool. It’s the heart of the open-source community, sort of a cross between a social network and project management tool. It’s by far the largest site of its type, having already bested competing offerings from Microsoft and Google. It hosts open-source software projects from countless companies and organizations, including Apple, Amazon, Facebook, Google, Walmart, and the US government. According to Microsoft, GitHub has 28 million users and hosts 85 million codebases. It also hosts proprietary code and internal communications for many companies that pay to use its private hosting service.

The deal is the latest in a series of moves by Microsoft to position itself as a champion of open source. In recent years, it has released open-source programming languages and tools of its own, helped translate open-source software to the Windows platform, and started supporting, and even using, Linux on its cloud platform Azure. All of this is designed to help attract developers to Azure, and the decision to purchase GitHub fits well into this pattern. Once the deal closes, Microsoft could tie GitHub and Azure more closely together to encourage developers to run their apps on the company’s cloud services.

"This is about getting access to those 26 million developers, getting their ear," says Quincy Larson, founder of the programming education site Freecodecamp.

At the same time, tying GitHub too closely to Azure risks alienating developers who work with rival cloud platforms from Google, Amazon, and others.

There are other potential advantages for Microsoft. RedMonk analyst Stephen O'Grady points to GitHub’s vast store of data about developers and their projects. Larson suggests Microsoft could mine GitHub to find programmers skilled in particular languages or technologies, and integrate that data with LinkedIn, which Microsoft acquired in 2016, to help LinkedIn’s recruiter customers find programming talent.

Microsoft’s interest in GitHub reflects a big change at the company and the industry. Open source is no longer fringe, it’s a core part of doing business for any tech company. Some developers remember former CEO Steve Ballmer calling Linux a “cancer” in 2001, and Microsoft threatening to sue Linux companies like Red Hat back in 2007. Alienating GitHub users by, say, making it harder to use competing products with the service, could reset Microsoft’s image to those dark days.

Open source developers have seen what bad things can happen when a popular hosting platform changes hands. Before GitHub, Sourceforge was the best-known host of open-source projects. In 2012, Sourceforge was acquired by career-services firm DHI Holdings, owner of the job-listing site Dice.com. Users were soon complaining that the site was plastered with too many ads, many of which tried to trick users into downloading software they didn't want. In 2015, the company took this a step further and began bundling what some users called adware or malware into downloads of hosted projects the company deemed "abandoned." DHI quickly stopped this practice, but the damage had already been done; many high-profile projects left the site. DHI sold Sourceforge to Bizx in 2016.

Some GitHub users aren’t waiting to see what Microsoft does. Finland-based open-source software developer Andre Medeiros, who is currently helping build a peer-to-peer social network called ScuttleButt, says he's already started moving some of his code from GitHub to competitor GitLab. Eventually, Medeiros says he hopes to switch to peer-to-peer solutions like ScuttleButt or Dat.

"GitHub has always been a neutral platform that only competes against similar services, like BitBucket and GitLab," he says. But Microsoft, he points out, competes with cloud-computing companies, web-browser makers, and many others. "I worry GitHub won't be neutral anymore."

GitLab said it saw a 10-fold increase in project imports Sunday after news broke that Microsoft would acquire GitHub. But it appears that most companies are willing to give Microsoft the benefit of the doubt, at least for now.

Czech developer tooling company JetBrains sells products that compete with Microsoft's own line of programming tools, but doesn't plan to move its open-source projects from GitHub. "With this acquisition, Microsoft has announced that it will continue to be the steward of the GitHub Community and the openness and collaboration it stands for," JetBrains VP of developer advocacy Hadi Hariri says. "As long as they honor that, we do not foresee any issues, independently of whether JetBrains and Microsoft are competing in other areas."

For its part, Microsoft claims GitHub will continue to operate independently. “We recognize the responsibility we take on with this agreement,” CEO Satya Nadella wrote in a blog post about the acquisition. “We are committed to being stewards of the GitHub community, which will retain its developer-first ethos, operate independently and remain an open platform. We will always listen to developer feedback and invest in both fundamentals and new capabilities.”

O’Grady says the restrained response has a lot to do with Nadella. Since taking over in 2014, Nadella has helped position Microsoft as a company concerned less with maximizing Windows sales, and more with making products that run on a variety of different platforms.

Larson, the Freecodecamp founder, says he plans to stay because moving away from GitHub would mean losing the network effect that makes GitHub so useful in the first place, and force him to publicize a new location for code and other files and training developers to use a new workflow. He thinks that will keep most developers on GitHub for the foreseeable future.

But if they’re not happy with it, they could eventually leave. Just look at what happened to Sourceforge.